Tuesday, March 31, 2015, 5:06 p.m.

Soul of the South to air news

New program will set TV network apart, executive says

Arkansas Democrat-Gazette/BENJAMIN KRAIN --08/6/2014--
Soul of the South television network news director Tom Jacobs , left, and Chairman Doug Henry, right, will soon broadcast a live newscast from Little Rock where the national network's studio and control room is.

He and news director Tom Jacobs say they are undeterred by the failures of similar undertakings.

"For the most part, TV news targeting African-Americans has been a bust," said an article published in April in industry publication TVNewsCheck.

If that weren't enough, there is a reminder of failure -- or at best mixed success -- posted on a sign in the Soul of the South parking lot that still bears the names of Equity Broadcasting at the top, followed by RTN, My 42 and UPN.

The building was once home to Equity Broadcasting Corp.

Founded in the late 1990s, it grew to 41 stations and in 2005 formed the Retro Television Network.

But Equity developed serious financial problems and in 2008 sold Retro Television to Luken Communications, which continues to air reruns of sitcoms and dramas.

The next year, the remaining assets of Equity were liquidated in bankruptcy court.

Larry Morton was chief executive of Equity. He was also the first CEO for Soul of the South, recently relinquishing the job to McHenry. Soul of the South went on the air May 27, 2013.

Jacobs said that Morton served in a temporary capacity until someone else could take over.

Soul of the South has put nearly $300,000 into the 30,000-square-foot building to bring it up to date. That money came from a $500,000 grant from the Arkansas Economic Development Commission, which has a "clawback" provision that would come into play if the company does not reach the employment level of 174 jobs by April 2021, McHenry said.

The network employs between 30 and 40, with most in Little Rock, Jacobs said, adding that there have been seven or eight layoffs at lower levels.

The Arkansas Capital Corp., a Little Rock-based nonprofit economic development firm, lent the network $1.5 million secured by a first mortgage. Also, the network got $1.2 million from the sale of tax credits issued through a subsidiary of Arkansas Capital, in conjunction with the Arkansas Development Finance Authority and the AEDC.

The network is in 25 metropolitan markets, either as a "diginet," received on "digital rabbit ears," or cable, Jacobs said. Entry into 18 more markets is pending within the next 30 to 90 days, Jacobs said. It is on five cable systems, reaching a combined audience of about 4 million, though not yet in Little Rock, where it is carried on KKYK subchannel 30.1, he added. Diginets are subchannels of full-power stations, he said.

"We plan to break even next year," McHenry said. "We plan to generate between $6 million and $10 million in gross revenue [in 2015], on a cost basis ... of $6.5 million. The next year, with an increase of 10 to 15 percent in expenses, the network projects doubling its revenue," he said.

Already, several overtures have been made to invest in the company or buy it, McHenry said.

Wussler Media Entertainment Inc. of McDonough, Ga., last month made an $8.5 million offer, according to a proposal obtained by the Arkansas Democrat-Gazette. Although Wussler withdrew the offer, it is still interested in Soul of the South, Wussler Chairman and CEO Tim Holly said. "It's a solid concept."

Decades of experience

Jacobs brings four decades of experience as a news director for television stations in major markets across the country and producer and director for films and documentaries that have aired on the Public Broadcasting Service and other networks.

"I do news that has a cultural perspective to it," he said. As for the news targeting a particular audience, he said, "I'm not doing 'black news.' I'm a journalist who happens to be an African-American who is doing news."

McHenry, who was president of entertainment at Soul of the South before replacing Morton, is a veteran movie producer and director.

Among the films he produced are New Jack City, Crush Grove and, in one capacity or the other, the House Party movies on the Fuse cable channel. His most recent directorial effort was Borrowed Moments. He also produced a TV series, Malcolm & Eddie, in the late '90s.

Holding a law degree and Master of Business degree from Harvard, he started out as an "entertainment attorney" then moved from the business side, eventually forming his own production company, he said.

As producer, he knows about putting a movie together, from raising the money and hiring the director to arranging distribution.

Starting a whole new television network "is an enormous task," McHenry said. "You've got to have enough capital to do two things at one time. You've got to get your distribution footprint out there. And you have to provide content that will attract viewers and advertisers.

Door opened

The FCC opened the door in 2011 to increase the number of minority-group owners of cable networks as part of a compromise when it approved the acquisition of NBC/Universal by Comcast. As a result, minority ownership has increased. For example, Magic Johnson, the former NBA star, launched Aspire in 2012, a cable network aimed at blacks, McHenry said.

Oprah Winfrey's OWN network predates the latest generation of black systems, as does BET.

The other black-owned or operated networks are Bounce, a diginet, and cable networks Revolt and TV One.

Soul of the South is different, McHenry says.

Along with cultural and entertainment offerings, the network aims to provide health data and consumer advice, he said.

The Soul of the South's weeknight show from the nation's capital, D.C. Breakdown, is straight reporting, though its anchor, Angela Rae, is sort of a "Charlie Rose with an edge," McHenry says. It is followed by a news program, production of which will soon be done in in Little Rock.

He views Europe, Africa and South America as untapped markets.

While McHenry has a world view, he says he has heart for the South.

His mother was born in Natchez, Miss., and he lived with his grandparents in Vicksburg, Miss., for the first eight years of his life.

"I believe there is a dearth of news from a different kind of a perspective. Not the kind of advocating, Fox/MSNBC type of business," McHenry says.

"I'm just talking about news." He said he wants to tell the stories "that resonate in an underserved community and have a national platform that enables me to do it. [That] just tickles me to death."

I'll bet the three stooges have no problems for the incentives for Big River Steell mill to be built.The incentives authorized by the bill, proposed by Rep. Monte Hodges, D-Blytheville, include a $70 million grant to fund infrastructure costs for construction, a $50 million loan and a $20 million grant for stabilizing the ground on which the plant will be built, next to the Mississippi River.